iPhone loses market share to Android

According to new research, the iPhone’s hold on the smartphone market share is slipping while Android continues to grow.

New York-based analytics firm ABI Research measures sales of smartphones from quarter to quarter.

Analysts have predicted that as the choice and availability of Android phones continue to increase, the OS will gain more market share, but no firm evidence of that has been seen until now.

The numbers from ABI Research, as quoted by The Wall Street Journal show that the iPhone accounted for 18.1% of global smartphone sales in the third quarter of 2009. By the fourth quarter that number had slipped to 16.6%.

While Apple’s sales grew through the fourth quarter, the increase didn’t keep up with the 26% overall increase in smartphone sales during the time. According to the research, this is the first quarter-to-quarter drop in smartphone market share for Apple in two years, with the last drop in late 2008.

The company that saw the biggest increase in the quarter was Motorola, most likely due to the release of its Droid smartphone. The company shot up to a 4% share of the global market.

But Apple hasn’t neglected to notice the popularity rise of Android and rumour has it that another version of the iPhone is in the works. And with the pressure on Apple to deliver something new, a report on Electronista said that the new iPhone will have HD video playback and might even include 720p HD video capture. The same story reported that the next generation iPhone will also get a 5-megapixel camera.